The Russian government’s decision to nationalize Lesta, the publisher of the popular “World of Tanks” franchise, has sent shockwaves through the IT industry, prompting entrepreneurs to re-evaluate the investment climate. The move, which deems Lesta an extremist organization, raises significant questions about the future of the company and the broader implications for businesses operating in Russia.
The nationalization stems from accusations of Lesta financing the Ukrainian army, a claim that the company vehemently denies. Despite Lesta’s Russian ownership, significant domestic investments, and the patriotic nature of its flagship game, the court ruled to transfer 100% of the company’s shares to the Russian Federation.
The legal justification for the nationalization has been met with skepticism, particularly concerning the licensing agreement for “World of Tanks.” According to experts, the license is contingent upon Malik Khatazhaev’s operational management of Lesta. His removal due to nationalization could nullify the license, potentially rendering the game pirated. This situation poses challenges for continued development, as it relies on licensed software tools from Western companies.
Moreover, the nationalization jeopardizes Lesta’s “Tanks Blitz” mobile game, which generates a significant portion of the company’s revenue. The game, registered under Lesta’s Uzbek subsidiary, faces potential removal from the AppStore and Google Play following the ownership change.
The loss of the license and the potential expulsion from major app stores could severely impact Lesta’s profitability and operations. Experts predict a substantial decrease in income, making it difficult for the company to remain profitable. Furthermore, the uncertainty surrounding the nationalization has already led to decreased employee morale and an exodus of talent to competitors or foreign countries.
Despite the challenges, the new owners will inherit substantial assets, including significant funds and real estate holdings. Lesta’s accounts hold a considerable amount of funds, and the company owns office buildings in Moscow, St. Petersburg, and Tashkent. The total value of the business acquired by the state is estimated at approximately 50 billion rubles.
Lesta’s lawyers have announced their intention to appeal the court decision, but the outcome is widely perceived as predetermined. The nationalization of Lesta serves as a stark reminder of the potential risks associated with operating in the Russian market and raises concerns about the future of the IT industry in the country.